Việt Nam Construction Bank corruption trial continues

HCM CITY — Phan Thành Mai, the indicted former general director of Việt Nam Construction Bank (VNCB), asked the court to reconsider the amount of purported loss on the third day of his trial for “deliberately violating State regulations on economic management causing severe consequences” at his former bank.

Mai said of the VNĐ6.1 trillion ($274 million) loss, VNĐ4 trillion ($182 million) is still at the bank and had been used to increase its registered capital.

Other assets were also created with the loan of $274 million but were not considered by relevant authorities, he claimed.

He said Phạm Công Danh, 51, the former chairman of VNCB, was not created favourable conditions to recover the losses before the police arrived at the loss figure.

But the judges rejected his claims saying banks cannot legally increase their capital using loans from other banks, and that the State Bank of Việt Nam had expressly rejected VNCB’s plan to do so.

The central bank had also confirmed that the sum of VNĐ4 trillion was gone, they said.

According to the indictment, in 2013 and 2014, Danh, who had also then been general director of the Thiên Thanh Group, instructed his staff to use 29 companies he ran to take loans worth more than VNĐ6.1 trillion ($274 million) from TPBank, Sacombank and BIDV.

He allegedly spent the borrowed money personally and the loans were not repaid.

They had been guaranteed by deposits VNCB had made in the three banks, and the money had been set off against the debts by these banks.

Bê told the court he had known Danh for five years before giving the loans and had instructed Phan Huy Khang, then general director of Sacombank, to check the application and documents.

The chairman of the juridical council asked Bê why he had not insisted on a mortgage, business plan and debt repayment plan as stipulated in the Credit Organisation Law.

Bê replied: “I considered Danh only as a representative of a company and the council should not consider my private relationship with him as a factor in the violation of State regulations on economic management."

Khang admitted his responsibility in the case though he had only carried out Bê’s orders, but said “my staff did not do exactly [as I said]”.